SHANGHAI, Oct 8 (Reuters) - The yuan weakened slightlyagainst the dollar on Monday as firms demanded less cash afterthe long holiday, though the Chinese currency briefly touched arecord high in early trade before banks finished adjusting theircurrency portfolios.

The yuan last hit an all-time high on Sept. 28, the lasttrading day ahead of a week-long holiday, amid strong corporatedemand for yuan and banks' efforts to avoid carrying short yuanpositions over the long break.

In September, the currency scored its biggest monthly thisyear, rising 1 percent as the third round of U.S. quantitativeeasing (QE3) weakened the dollar and sparked interest in riskierassets such as emerging market currencies.

But with two record highs being hit in succession, propelledby corporate position adjustments to accommodate temporary yuandemand during the break, the currency appeared to have reachedits peak and should depreciate slightly in the near term,traders said.

"Except for a final round of holiday-driven positionadjustments in early trade today, the trend for the yuan tocorrect is quite clear," said a trader at a Chinese state-ownedbank in Shanghai.

Spot yuan was trading at 6.2864 versus the dollar by late morning, weaker than the 6.2849 level where it closedon Sept. 28. It earlier touched an intraday high of 6.2812, itsstrongest since China set up the domestic foreign exchangemarket in 1994.

The PBOC has set a slew of midpoints much weaker than theyuan's trading levels since mid-September, in what traders saidwas a sign that the central bank was acting to prevent renewedspeculation on yuan appreciation after QE3.

Traders said they expected the yuan to weaken below 6.30against the dollar in next one or two weeks but should be ableto find short-term support at 6.33 in the near term, barringmajor movements in the dollar index in global markets.